Session of 1998
                   
SENATE BILL No. 566
         
By Senators Hensley, Barone, Biggs, Downey, Feleciano, Gilstrap,
         
Gooch, Goodwin, Jones, Karr, Lee, Petty and Steineger
         
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          10             AN ACT relating to inheritance taxation; increasing certain distributee
11             deduction amounts; amending K.S.A. 79-1537 and 79-1542 and re-
12             pealing the existing sections.
13            
14       Be it enacted by the Legislature of the State of Kansas:
15           Section 1. K.S.A. 79-1537 is hereby amended to read as follows:
16       79-1537. (a) A tax is hereby imposed on the privilege of succeeding to
17       the ownership of any property, corporeal or incorporeal, and any interest
18       therein within the jurisdiction of this state.
19           (b) Distributees of estates shall be classified as follows:
20           (1) Class A shall consist of the lineal ancestors, lineal descendants,
21       step-parents, step-children, adopted children, lineal descendants of any
22       adopted child or step-child, the spouse or surviving spouse of a son or
23       daughter, or the spouse or surviving spouse of an adopted child or step-
24       child of the decedent. In the case of an adopted child or step-child, a
25       spouse or surviving spouse of an adopted child or step-child or the lineal
26       descendant of an adopted child or step-child of the decedent, such person
27       shall file with the department of revenue an affidavit setting forth the
28       relationship of such person to the decedent. Such affidavit shall be suf-
29       ficient proof of the adoptive or step-child relationship in question, and
30       the department, or any officer or employee thereof, shall not require any
31       additional proof of such relationship. As used in this paragraph, ``step-
32       child'' means a child of a spouse or former spouse of the decedent.
33           (2) Class B shall consist of the brothers and sisters of the decedent.
34           (3) Class C shall consist of relatives of all degrees of consanguinity,
35       except those included in classes A and B, and shall also include strangers
36       in the blood of the decedent.
37           Notwithstanding the foregoing provisions of this subsection, with re-
38       spect to qualified terminable interest property includable in the dece-
39       dent's estate under K.S.A. 79-1557a, and amendments thereto, the rela-
40       tionship of the distributees of such property shall be determined by their
41       relationship to the individual whose estate made an election with respect
42       to such property pursuant to subsection (b)(3) of K.S.A. 79-1537b, and
43       amendments thereto.

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  1           (c) (1) From the value of the shares of the distributable estate, as
  2       ascertained under the provisions of this act and succeeded to by the sev-
  3       eral distributees, deductions shall be allowed as follows: (A) To each
  4       member of class A, $30,000 $1,000,000; and (B) to each member of class
  5       B, $5,000 $100,000.
  6           (2) The tax herein provided for shall be charged upon the value of
  7       the shares of the distributable estate after deduction of the amounts
  8       herein provided, except that when one or more of the shares of the dis-
  9       tributable estate shall consist of property within and property without the
10       state, only such percentage of the deductions above named shall be al-
11       lowed in the percentage that the Kansas share bears to the total shares
12       of the distributee.
13           (d) The tax herein imposed shall be an amount equal to a percentage
14       of the value of the shares of the distributable estate of the decedent
15       succeeded to by the distributees thereof, reduced by any deductions au-
16       thorized pursuant to subsection (c):
17           (1) Upon the value of shares succeeded to by members of class A
18       reduced by such deductions, the following rates of tax are hereby im-
19       posed: On the first $25,000, or fraction thereof, 1%; on the second
20       $25,000, or fraction thereof, 2%; on the next $50,000, or fraction thereof,
21       3%; on the next $400,000, or fraction thereof, 4%; on all over $500,000,
22       5%;
23           (2) upon the value of shares succeeded to by members of class B
24       reduced by such deductions, the following rates of tax are hereby im-
25       posed: On the first $25,000, or fraction thereof, 3%; on the second
26       $25,000, or fraction thereof, 5%; on the next $50,000, or fraction thereof,
27       71/2%; on the next $400,000, or fraction thereof, 10%; on all over
28       $500,000, 121/2%; and
29           (3) upon the value of shares succeeded to by members of class C, the
30       following rates of taxes are hereby imposed: On any amount up to
31       $100,000, 10%; on any amount in excess of $100,000 and up to $200,000,
32       12%; on all sums in excess of $200,000, 15%.
33           Sec. 2. K.S.A. 79-1542 is hereby amended to read as follows: 79-
34       1542. As used in this act unless the context otherwise requires:
35           (a) Any term used in this act shall have the same meaning as when
36       used in a comparable context in the internal revenue code. Any reference
37       in this act to the ``internal revenue code'' shall mean the provisions of the
38       United States internal revenue code of 1986, as such code exists on De-
39       cember 31, 1992 1997. Any reference in this act to a specific provision of
40       the internal revenue code shall be to such provision as it exists on De-
41       cember 31, 1992 1997.
42           (b) ``Deemed executor'' includes any person in actual or constructive
43       possession of any property of the decedent.

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  1           (c) ``Director'' means the director of taxation.
  2           (d) ``Distributee'' means a beneficiary, legatee, devisee, heir, next of
  3       kin, grantee, donee, vendee, joint tenant or any other successor in inter-
  4       est, whether outright or in trust.
  5           (e) ``Distributive share'' or ``distributive shares'' means the share or
  6       shares of the distributive estate passing to a distributee or distributees.
  7           (f) ``Domicile'' refers to that place where a person resides, has an
  8       intention to remain and to which they intend to return following any
  9       absence.
10           (g) ``Estate'' and ``property'' shall mean the real, personal and mixed
11       property or interest therein of the testator, intestate, grantor, bargainor,
12       vendor or donor which shall pass or be transferred to legatees, devisees,
13       heirs, next of kin, grantees, donees, vendees, or successors and shall in-
14       clude all personal property within or without the state.
15           (h) ``Executor'' and ``administrator'' mean the duly appointed, quali-
16       fied and acting executor or administrator of the decedent in this state.
17           (i) ``Nonresident decedent'' means a decedent who was not a resident
18       decedent at the time of death.
19           (j) ``Personal representative'' means the executor, administrator or
20       deemed executor of the decedent.
21           (k) ``Resident decedent'' means a decedent who was domiciled in this
22       state at the time of death.
23           (l) ``Secretary'' means the secretary of revenue, or the secretary's des-
24       ignee.
25           (m) ``Tax'' includes tax, penalty and interest, unless the context of a
26       particular section otherwise requires.
27           (n) ``Transfer'' shall include the passing of property or any interest
28       therein in possession or enjoyment, present or future, by inheritance,
29       descent, devise, succession, bequest, grant, deed, bargain, sale, gift or
30       appointment in the manner herein prescribed.
31           Sec. 3. K.S.A. 79-1537 and 79-1542 are hereby repealed.
32           Sec. 4. This act shall take effect and be in force from and after its
33       publication in the statute book.
34      
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